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Bill aims to slash Medicare waste and fraud

Senators on both sides of the aisle introduced legislation Monday aimed at preventing waste, fraud and abuse in the Medicare and Medicaid systems.

The bipartisan bill, "Preventing and Reducing Improper Medicare and Medicaid Expenditures Act of 2013," or PRIME Act (H.R. 2305), targets improper payments made by the federal government to illegitimate beneficiaries.

Senate Homeland Security and Governmental Affairs Committee Chairman Tom Carper (D-Del.) and Ranking Member Tom Coburn (R-Okla.) along with Reps. Peter Roskam (R-Ill.) and John Carney (D-Del.) introduced the bill in an effort to boost penalties for fraudsters, expand fraud-reporting programs — such as the Senior Medicare Patrol — and increase fraud data-sharing across government agencies.

The Government Accountability Office estimates the Medicare program dispensed $44 billion in improper payments in 2012.

"The problem of Medicare fraud is an urgent one — we cannot continue to allow these critical programs to be fleeced because of carelessness or criminals gaming the system," Roskam said in a press release. "The program's current pay-and-chase model pays out even suspicious Medicare claims, costing taxpayers billions of dollars".

Under the current model, Medicare's Recovery Audit Program identifies and reclaims overpayments and improper payments. If passed, the PRIME Act will require the Centers for Medicare and Medicaid Services (CMS) to more closely track and prevent overpayments.

The PRIME Act would also require contractors to meet certain accuracy requirements or face penalties. Medicare fee-for-service programs made $29.6 billion in improper payments from Jul. 1, 2010 through June 30, 2011, according to PaymentAccuracy.gov.

"Improper payments divert scarce resources away from those most in need," Coburn said. "I'm pleased there is a bipartisan consensus to address this issue by making substantial improvements to restore the integrity of these programs."

Under the Affordable Care Act, the Obama administration outlined initiatives to decrease improper payments made my Medicare and Medicaid.
CMS announced June 6 that redesigned Medicare Summary Notices will be delivered to Medicare beneficiaries as part of the Affordable Care Act fraud-reduction initiative. The redesigned notices are structured to help beneficiaries understand benefits, file an appeal if denied and identify claims for services they never received.

"The PRIME Act is what I like to call a win-win for those of us who are concerned about protecting Medicare and Medicaid by ensuring that these programs have the resources to provide excellent care for beneficiaries, and that taxpayer dollars are spent responsibly and effectively," Carper said.

The PRIME Act, however, is not the first of its kind. Former Republican Congressman Clifford Stearns, of Florida, sponsored a bill of the same name in 2011, but it died in committee.